As younger drivers pay higher premiums, they bear the brunt of any IPT increase in June.

Only as recently as October 2015, IPT stood at 6%, meaning we’ve seen a 100% increase in less than two years.

Black box solution

The growing popularity of telematics, also known as ‘black box’ insurance, directly correlates with a difficult market for younger drivers.

Premiums for young drivers have risen by 17% year-on-year (£284 comparing February 2016 to February 2017) to a total nearing £2,000 for a typical annual policy.

Telematics uses technology to bring down the cost of cover, rather than relying on demographic or social averages or arbitrary factors. A small device is installed inside that car, which then measures various different aspects of driving behaviour.

It particularly measures length of journey, type of roads, speed and smoothness of driving. It then sends the data to the insurer, who can then analyse it and adjust the driver’s premiums accordingly.

Those who perform well will be rewarded with cheaper premiums.

Kevin Pratt, consumer affairs expert at MoneySuperMarket, said: “Telematics offers a cheaper alternative to traditional policies if the driver can demonstrate he or she is a lower-risk proposition than the statistics for their demographic suggest.”

Eager to prove themselves good drivers, young motorists are more and more opting for these kinds of policies – which have increased by 13% in the last 12 months alone. We are already seeing a huge rise in 2017, with 51% of 17 year olds buying telematics products, compared to just 35% last year.

Kevin added: “Black boxes also make the roads safer by incentivising good driving habits.

“Any young driver on a traditional policy should spend five minutes shopping around when their policy is up for renewal – they could make significant savings if their black box data confirms they are safe and sensible behind the wheel.”